Panama Papers Reveal Need to Monitor Elite

If the bank statements of “regular” Americans were leaked, that would undeniably be an outrageous violation of privacy. The release of the Panama Papers — 11.5 million files from Panama-based law firm Mossack Fonseca detailing the firm’s business with its clients — has elicited outrage, but not because of privacy. People are protesting because the Papers detail the shadowy efforts undertaken by wealthy and powerful people across the globe to hide the true extent of their riches.

Despite most of Mossack Fonseca’s business being totally legal, it is important that the public has a window into the lives of those from the highest echelons of society, hidden until now by a veil of shell companies set up by the Panamanian law firm.

Manipulative finances — regardless of legality — are scandalous for public figures like celebrities or businesspeople. For politicians, they are disqualifying from public office. Embroiled individuals, firms and Mossack Fonseca itself deny law breaking. Intentionally or not on Mossack Fonseca’s behalf, laws were broken.

Even when actions remained in the legal realm, some individuals’ flagrant attempts to hide money transcended legality, entering the world of morality. Many firms acted immorally, but for the sake of this piece I will focus on individuals, particularly politicians. When the powerful are enabled to make the true extent of their wealth inconspicuous, something has gone wrong.

The importance of the Panama Papers’ release is highlighted by the fact that those implicated by the papers span the globe, united only by their preeminence within their countries. Leaders from global powers (Xi Jinping of China, Vladmir Putin of Russia), developing countries (Mauricio Macri of Argentina, a slew of Middle Eastern countries) and the Western World (Sigmundur Gunnlaugsson of Iceland, David Cameron of the U.K.) all found themselves under scrutiny for varying levels of shady behavior.

Of course, David Cameron’s tenuous connection to his father’s offshore holdings is not remotely of the same magnitude as Vladmir Putin’s multi-billion dollar network of money — that is not the issue. Many of the leaders in the hot seat are only indirectly connected to financial manipulation through their families — that is not the issue.

We should expect our leaders (and their families) to restrain from any even remotely shady financial holdings, regardless of magnitude or direct connection. Among those countries that choose their leaders, we give them enormous power, responsibility and respect. The slightest trace of misuse of these leaders’ power merits suspicion and investigation.

Most disturbing about arguments that the Panama Papers are more a privacy violation than a whistleblowing event is their assumption that the rich and powerful are like everybody else (a myth they love to propagate), without obligations of transparency. When individuals move millions or billions of dollars through mysterious companies set up by a tax haven law firm, those individuals are not like everybody else.

By being a politician, a businessperson, a celebrity or other public figure, an individual or firm accepts the dichotomy of power and privacy. As they become more powerful, they must become more transparent and accept less privacy. The depth and breadth of the activities detailed in the Panama Papers, and the reaction to try and make the Papers an issue of privacy, reveals that the rich and powerful of the world refuse to accept that.

Understanding the mentality of the global elite, it is unfortunate but necessary that the majority of Mossack Fonseca’s innocent clients have had their finances and legal activities exposed. This is because of the real tragedy revealed by the Panama Papers: the ease with which those with power, money and influence navigate the global legal and financial systems to avoid legitimate taxation.

In the aftermath of the Panama papers, we must ask ourselves if we will allow not just our leaders, but the entire global upper class, to continue flouting the rules.